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2008 Economic Calendar |
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Resource Center » U.S. & Intl Recaps | Release Dates | Why Investors Care | Today's Calendar
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Durable goods orders reflect the new orders placed with domestic manufacturers for immediate and future delivery of factory hard goods. The first release, the advance, provides an early estimate of durable goods orders. About two weeks later, more complete and revised data are available in the factory orders report. The data for the previous month are usually revised a second time upon the release of the new month's data. Why Investors Care
| Released on 11/28/06 For Oct 2006 | ||||||||||||
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Highlights
Manufacturing continues to soften. Durable goods orders dropped 8.3 percent in October, following a revised 8.7 percent jump in September. The fall in October was greater than the consensus forecast for a 5.0 percent decline in durables orders. Weakness was primarily in civilian aircraft - in the transportation component. But even excluding the volatile transportation component, new orders declined 1.7 percent, following a 0.5 percent increase in September. Within transportation, civilian aircraft orders fell 44.5 percent after a monthly 198.2 percent surge in September. New orders for motor vehicles actually rose 1.4 percent after a 6.0 percent drop the month before. Nondefense capital goods orders fell 15.6 percent in October, following a 24.7 percent jump in September. Excluding aircraft, nondefense capital goods orders declined 5.1 percent in October after posting a 3.2 percent increase in September.
Despite the overall drop, durables orders were mixed for the month of October with gains seen in some industries. Industry categories posting gains in October were primary metals, up 1.1 percent; machinery, up 1.4 percent; electrical equipment, up 5.1 percent; and "other," up 0.3 percent.
Industry categories showing declines in October were fabricated metal products, down 2.5 percent; computers & electronics, down 10.2 percent; and transportation, down 21.7 percent.
Overall inventories rose 0.8 percent in October, following a 1.1 percent gain in September. Overall shipments rose 0.6 percent in October while unfilled orders increased 1.2 percent. Shipments of non-defense capital goods fell 2.3 percent in October, following a 0.3 percent dip in September.
Year-on-year, new orders for durable goods fell to 2.3 percent from 15.2 percent in September. Unfilled durables orders slipped to a 21.8 percent year-on-year increase in October from 22.3 percent in September.
Overall, today's report shows a weakening manufacturing sector - even after taking out the volatile transportation series. However, the softness is not full-fledged as some industries remain moderately healthy and outside of autos no industry is notably weak. Nonetheless, today's numbers are not positive for equities or the dollar. The bond market should like today's numbers.
Durable goods orders rebounded a sharp 7.8 percent in September, following a 0.1 percent drop in August. Strength was primarily in aircraft orders as civilian aircraft orders jumped a massive 292.4 percent on a monthly basis in September. In contrast, autos were down somewhat. Excluding transportation, new orders edged up 0.1 percent in September. Looking ahead for October, we can expect a sharp drop in aircraft orders to pull overall durables orders down.
New orders for durable goods Consensus Forecast for October 06: -5.0 percent
Range: -8.8 percent to -3.0 percent
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Monthly fluctuations in durable goods orders are frequent and large and skew the underlying trend in the data. In fact, even the yearly change must be viewed carefully because of the volatility in this series. |
| 2006 Release Schedule | ||||||||||||||||||||||||||
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